Blender for wood turning
Yes! (and it is easy)

Make a pen blank just like you would do in the real world, glue different pieces together, then turn them round.

I'm just using colored cubes as my wood pieces. It is literally just scaled cubes duplicated and with different materials. (I'm sure you are planing more complicated turnings.)


Now to see what it would look like turned down. 


This works better if the different pieces are all separate objects. (If there not just go into edit mode and press P > Loose Parts). 
Add a cylinder the same size as a finished pen blank (using real world units would help) and position it so that is goes through all of the laminated cube stack.

Do note here in these pictures I'm showing two different pen blanks. Thus I have two different cylinder objects, and twice as much work.
Back on the pen blank object, pick any of the pieces (lets use the top piece) and add a Boolean Modifier to the pen blank object. Set the Object to the cylinder object you added in step 2, and leafe the Operation as Intersect.
Now select all the other pen blank pieces, keeping the one you already added the boolean modifier to the active object, and press CtrlL > Modifiers.


Here is kind of what it will look like. (I kept the cylinder objects showing, changed them to wireframe display, but you should hide H them.)